According to FINRA, Lawrence Roger Rice (CRD #375304), a former registered representative based in Wellington, Florida, was barred from association with any FINRA member firm in all capacities. The bar was issued on August 14, 2024, through an Acceptance, Waiver, and Consent (AWC) agreement under FINRA Case #2024081415101.
Rice was found in violation of FINRA rules after he refused to provide documents and information requested by FINRA in connection with its investigation of allegations made in a Form U5 filing by his former member firm. The Form U5, formally known as the Uniform Termination Notice for Securities Industry Registration, is a mandatory regulatory filing that firms must submit when a registered representative departs. This document discloses the circumstances and reasons for the departure, and it becomes a permanent part of the individual's regulatory record accessible through FINRA BrokerCheck.
In Rice's case, the Form U5 alleged that he failed to timely disclose a pending civil action in which he was named. Registered representatives have an ongoing obligation to disclose certain personal legal matters to their employing firm and to regulators. This obligation exists under FINRA rules and the Uniform Registration Forms, including Form U4, which requires the disclosure of pending and concluded civil judicial actions, such as lawsuits. Timely disclosure of these matters allows firms to assess whether the legal issues could affect the representative's ability to serve customers or could pose reputational or financial risks to the firm.
Failure to disclose a pending civil action is a serious compliance matter. Firms rely on accurate and timely disclosures to fulfill their own supervisory and regulatory obligations. When a broker conceals legal matters, it deprives the firm and regulators of information that may be material to assessing that individual's fitness to serve in the securities industry.
When FINRA sought to investigate the allegations by requesting documents and information from Rice, he refused to cooperate. Under FINRA Rule 8210, all associated persons are required to provide information and documents when requested by FINRA in furtherance of its regulatory mission. Refusal to comply with a Rule 8210 request is an independent violation that typically results in the most severe sanction available, a permanent bar from the industry.
Without admitting or denying the findings, Rice consented to the sanction and the entry of findings against him. He is now permanently prohibited from associating with any FINRA-registered broker-dealer.
Investors should be aware that disclosure obligations exist to protect them. When brokers conceal legal issues, it may indicate broader problems with their integrity and trustworthiness. Investors can use FINRA's BrokerCheck to review disclosure events on a broker's record, including civil judicial actions, customer complaints, and regulatory actions. Reviewing these disclosures before selecting a financial professional is an important step in safeguarding your investments.
